The Rishi effect
Tue 30 Mar 2021
Paul Bennett, Director
The current Chancellor has proved he is one of the most influential figures in modern political history, thanks to his pandemic approach – a first-aid box comprising furlough, loans and cash grants. For many, however, it is his approach to the property market that is having the biggest impact.
His remedies for a pandemic property market have consisted of an extension to the already successful stamp duty holiday and the imminent introduction of Government-guaranteed 5% deposit mortgages. Now, as we conclude the first quarter of 2021, the effects of Mr Sunak’s intervention are being amplified across the country - and in the capital.
It has emerged that purchasers are still hungry to take advantage – even after a buying bonanza in 2020 - with Rightmove’s latest figures showing prospective purchaser numbers are 34% higher now than they were a year ago. The property portal has declared that we are in ‘the best sellers’ market in a decade’.
There is no doubt that activity is being bolstered by the stamp duty holiday – thanks to its cash saving of up to £15,000. One new survey claims 39% of Brits have already taken advantage of the initiative, while a further 8% are planning to get on the property ladder before the stamp duty holiday ends.
Analysis gathering has also revealed that activity in London is holding up. The first 12 months of lockdown saw almost 50,000 property transactions take place and this number is set to be surpassed in the coming year, with a hopeful return to a degree of international travel buoying activity.
In respect of the capital’s future property prospects, headlines have included ‘green shoots of recovery’ and a ‘lull before the storm’, with many experts forecasting a return to brisker business after a pandemic pause.
In fact, Stacks Property Search predicts ‘demand is likely to exceed supply, and we expect to see price rises, especially in prime central London’ adding that any ‘price reductions will fully reverse over the course of the next six months, and we predict that values will finish 2021 around 5% higher than at the end of 2020.’
Action for buyers
Sadly the stamp duty holiday can’t go on forever, so purchasers looking to take advantage are urged to do so now – especially as there could be some conveyancing and mortgage delays ahead.
The Chancellor has created two deadlines to note, thanks to his ‘tapering’ approach. No stamp duty will be payable on the first £500,000 of a home’s purchase price until 30th June 2021, then no stamp duty will be payable on the first £250,000 of a home’s purchase price until 30th September 2021. There will be a return to the standard stamp duty thresholds as of 1st October 2021.
The Government-guaranteed 5% deposit mortgages will start in April 2021, with High Street lenders offering home loans covering 95% of a property’s value to all buyers. If the predicted uptake materializes, demand for property will soar further, and registering with Behr & Butchoff will be essential to ensure you don’t miss out on new instructions.
Action for sellers
There is a glorious window of opportunity for sellers but you have to be on the market to enjoy the buyer demand. The Behr & Butchoff team can get the ball rolling with an in-person property valuation. Once instructed, we’ll contact our waiting list of purchasers – both here in the UK and overseas - as well as widely market your property online and in print.
The team will qualify all interested parties and identify the best buyer who is able to proceed – all we ask is that you instruct a conveyancing solicitor as soon as you start working with Behr & Butchoff. To start the buying or selling process, contact our team today.